Offshore wind is in trouble. New York state regulators dealt a serious blow this week to the industry’s financial picture, and that could hamstring President Joe Biden’s clean energy goals, writes Benjamin Storrow. The New York Public Service Commission, which oversees the state’s electric utilities, rejected a bid by offshore wind developers to recoup more money from customers to account for inflation. The asks weren’t small. Equinor and BP requested a 54 percent increase to the price paid for their projects. Ørsted asked for a 27 percent increase paid to its Sunrise Wind project. Democratic Gov. Kathy Hochul said the state’s “no” is aimed at ensuring New Yorkers can afford future electricity bills and are getting the best financial deal possible as companies develop large-scale sources of renewable energy. The decision imperils 4.2 gigawatts of offshore wind power in New York. Project costs have ballooned amid rising interest rates and supply-chain bottlenecks, and that’s sent developers scrambling to renegotiate power deals. Projects off the northeast Atlantic coast are central to Biden’s goal of building 30 GW of offshore wind by 2030 — enough clean energy to power 10 million homes and slash planet-warming pollution by 78 million tons by decade’s end. Now, roughly a quarter of the power needed to reach that goal will likely be delayed several years or canceled, Ben reports. “It is a bit of a mess, frankly,” Samantha Woodworth, an analyst who tracks the industry at the consulting firm Wood Mackenzie, told Ben. “These developers have already sunk so much money into these projects.” Still, New York officials say they remain committed to meeting their goal of generating 70 percent of the state’s power from renewable energy by 2030. Hochul directed state agencies to turn to another offshore wind bid and buy more power from other large-scale clean energy projects. Offshore wind is facing headwinds elsewhere, too. Since July, developers have canceled four electricity contracts to supply Massachusetts with 2.4 GW of power. A project serving Connecticut electricity customers is also on the chopping block.
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